KBR, INC. has recently released its latest 10-Q report. KBR provides science, technology, engineering and logistics support services to government and commercial customers, with operations organized into Mission Technology Solutions and Sustainable Technology Solutions. Its work includes defense and space systems engineering, cyber analytics, supply chain and program management, and proprietary process technologies for ammonia, syngas, petrochemicals and energy-transition applications.
In Item 2, management said the quarter was shaped by the June 18, 2025 termination of HomeSafe’s role in the Global Household Goods Contract, followed by the complete cessation of HomeSafe operations by April 3, 2026. KBR owns 72% of HomeSafe, and the business is now reported as discontinued operations in the company’s condensed consolidated statements for all periods presented. Management also said the Mission Technology Solutions business remains a continuing operation even though KBR announced plans in September 2025 to spin it off into a separate U.S. public company, with a target completion date of January 4, 2027.
For the three months ended April 3, 2026, revenue fell 5% to $1.923 billion from $2.018 billion a year earlier. Gross profit declined 12% to $265 million from $300 million, while operating income slipped 11% to $180 million from $202 million. Net income attributable to KBR was $102 million, down 12% from $116 million.
The revenue decline was driven mainly by reduced contingent activity within the European command in Mission Technology Solutions. Mission Technology Solutions revenue fell 6% to $1.296 billion from $1.381 billion, while Sustainable Technology Solutions revenue decreased 2% to $627 million from $637 million. Gross profit was also pressured by changes in licensing mix within Sustainable Technology Solutions.
Equity in earnings of unconsolidated affiliates rose 21% to $51 million from $42 million, helped by earnings from services on an LNG project in Sustainable Technology Solutions. Selling, general and administrative expenses declined 5% to $133 million from $140 million, aided by a favorable closeout in the first quarter of 2026, partly offset by costs tied to the planned spin-off. Interest expense fell 10% to $37 million from $41 million, reflecting lower U.S. federal reserve funds rates. The provision for income taxes was $40 million, compared with $43 million a year earlier, with the effective tax rate at 28% versus 26% in the prior-year quarter. As a result of these announcements, the company's shares have moved -3.75% on the market, and are now trading at a price of $37.22. For more information, read the company's full 10-Q submission here.
